posted July 13, 200909:53 AM
An interesting development. I'm rather of two minds on it myself and I'm not unsympathetic to both sides.

quote:Seemed like a good idea last month when Kiva, the microfinance Web site specializing in loans to Third World entrepreneurs, opened up to Americans sinking under the waves of the Great Recession. The Pissed Off Kiva Lenders Team thinks otherwise.

The group, representing 420 registered Kiva users at last count, has risen up against the San Francisco nonprofit's "shift from making loans exclusively where the needs are greatest to where they are the least." The group's published broadsides are accompanied by compare-and-contrast thumbnails, juxtaposing an affluent-looking San Francisco graphic designer who recently got a $7,000 loan to buy computer equipment and a Peruvian peasant woman who borrowed $350 "to buy wool for knitting."

We get the point. So, apparently, do 43 percent of respondents to a Kiva-posted poll as of Wednesday afternoon. Then again, 48 percent favor the program, which started a month ago and has so far funded approximately 40 U.S. applicants. There is also a pro-U.S. countergroup, called the Kiva Happy Lenders.

posted July 13, 200910:38 PM
Yes, it's interesting to me that some people are very upset about kiva lending to people in the US. I don't see any problem, myself. A small minority are quite against it, though.

I was offline (IPS trouble) for 8 days in early July, so I've just now done the July loan. Go to our portfolio to see the entrepreneur I picked. I'll add an entry here soon.
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posted October 30, 200910:11 AM
Update: I've loaned to people each month around the first of the month, which you can see if you go to our lender page.

However, I'm seriously worried about kiva lately. They've made a number of questionable decisions and alienated almost their entire core lender base. Another MFI went belly up (Ebony Foundation in Kenya) and while there's some indication that the post-election violence played a part, many of the loans they funded were well after the violence. It seems that fraud has played its part.

I realize that as for MFI failure, we're nowhere near the mature default rate, which could go to 10% or 20% or higher. I think people will pull their money out of kiva when that happens, and kiva itself will be in danger of folding. They've made so many terrible business decisions during what for them is an up time, the steady increase in lending that they've encountered so far.

And if they close their doors, I don't think we can get even a cent back that we loaned. The lender agreement basically makes the loan indistinguishable from a gift.

So here's what I propose to do with the money. I have exact records on who gave what when. All the money funded by hatrackers I plan to withdraw as it's paid off and give it to a charity of the board's choice. This might be first book, or heifer international, or perhaps you'll want to give it to Florence's school, when I tell you about it.

Florence Kaluuba is a wonderful lady in Uganda who runs the Mirembe school for young girls, many of whom have been abandoned by their families and were street people. She teaches them to be teachers, or seamstresses, or how to run childcare facilities, hairdressing, and several other professions. Her graduates are in great demand. All the teachers have jobs waiting for them when they get out.

Her students learn also how to be good mothers to their children. The teacher graduates among them often go on to teach school in villages and neighborhoods where there was no school before. In this way there is a multiplier effect because each student of Florence's school teaches more students and so on. Overall the education level of the country advances, and education is the biggest driver of development. So by helping Florence we help the whole society.

Her seamstresses sew uniforms for the school children, her daycare professional students keep the young children of the students, etc. So that each facet of the school aids the other areas.

Here's the entire topic on the kiva friends forum documenting how we found and have donated to Florence's school in the past. We hold fundraisers from time to time for the purpose. Florence in turn gives us budgets of how she proposes to spend the money as well as photos of the classes, graduation ceremonies, and updates on the accreditation process, etc. The school is now accredited and has a good local reputation.

Here's a summary topic capturing in shorter form all the information we have received along the way about the school. It has captured my heart. These girls' lives have been turned around totally, and they go on to transform the lives of those around them, and of their own students, in turn. Florence works tirelessly to implement her vision. I think this is as worthy a cause as any I've seen anywhere, and so that's why the portion of funds I've contributed to the kiva fund (minus all the fees and kiva donations, which I paid myself not using any contributed funds for that) is going to Florence's school.

I'll donate the contributions of other hatrackers to whatever organization y'all choose. If you also decide to support Florence's school that will be easy. I'll just transfer all funds over as they're repaid. Otherwise it will take more accounting but I'll be glad to donate to First Book, Heifer, or whatever charity is chosen.

All good things have to come to an end, as you know. I wish kiva well and I hope they're able to get it together in order to be a sustainable steady-state operation at some time in the future. However, I would feel remiss in my duty to oversee this fund if I didn't flag the problems and exercise due diligence in saving as much of the fund as possible from future defaults. The money going to Florence would be a donation, not a loan. But I don't think there could be a worthier cause in which to invest our contributions.
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posted October 30, 200912:15 PM
Browsing that site, I don't agree with their selection criteria.

quote:Does the charity publish high-quality monitoring and evaluation reports on its website? A charity meets this criteria if it freely publishes - on its website - at least one technical report that (a) discusses how the impact of a project or program was evaluated, including what information was collected and how it was collected; (b) discusses the actual impact of the project. (Why is monitoring and evaluation so important?) We seek enough evidence to be confident that a charity changed lives for the better - not simply that it carried out its activities as intended. Different programs aim for different sorts of life change, and must be assessed on different terms. We do not hold to a single universal rule for determining what "impact" we're looking for; rather, what we look for varies by program type. (For more, see, What constitutes impact?)

Does the charity stand out for program selection? A charity meets this criteria if it focuses primarily on (or publishes enough financial information to make it clear that 75% of its recent funding is devoted to) what we consider "priority programs" These programs have particularly strong evidence bases, enough to lower the burden of proof on a charity running them. (Why do we look for charities implementing proven programs?) Such programs include administering vaccinations, distributing insecticide-treated nets, and treating tuberculosis, among many others. (For more, see our full list of priority programs.)

I don't care if a charity's evaluation and monitoring reports are on their website, as long as they are publically available in some way. And while I agree with many of thier priorities, 75% of funding or more matching a list of specific programs is not vetting cost-effectiveness, it's vetting whether or not the organization has the same priorities as Givewell does.
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posted October 30, 200912:46 PM
Tatiana, I think you've done a fantastic job managing our loans. Whatever you decide is the most effective way to use this money, i'm fine with that. I came in pretty late though I think, most of my loans have been made after the team was formed.

But whatever I did contribute, please use as you wish.
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posted October 31, 200911:41 AM
dkw, from what I can tell, Givewell's priorities on evaluation & monitoring are exactly identical to what any good development economist will tell you is important in tracking whether an intervention actually has measurable results. *shrug*
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posted October 31, 200906:27 PM
From their own statement, they make their initial review based on whether the information to make those calls is on the charities website. Not whether evaluation and monitoring reports exist, not whether they are available upon request, whether they are on the website. I checked several organizations that I am familiar with, that I know meet their criteria, and they were given 0/3 stars because they didn't have the information on their website. I think that is stupid and borderline dishonest. It would be more ethical to list them as "not reviewed" or leave them off the list altogether.
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posted November 06, 200910:54 AM
I am the co-Founder of GiveWell. I'm just posting to say that I think dkw raises a valid concern, and we have recently made a blog post discussing this issue. http://blog.givewell.net/?p=445Posts: 1 | Registered: Nov 2009
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posted November 06, 200911:35 AM
dkw, I would say that lack of easily available public information is a big red flag for me in donating to a cause, and also a bad signal for the charity's actual work.

Given a limited number of donation dollars, I would prefer to donate to an organization which has their act together enough (and considers transparency an important enough issue) to get their information up on a website.

I realize that not everyone donates using this sort of approach. But, then, I'm the sort of person who gets really irritated by news that someone donated a bunch of money to a liberal arts college in the US or to organizations like the Boy Scouts. It's all about opportunity cost with me.
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